47-2A220

47-2A220. Effect of default on risk of
loss

A. Where risk of loss is to pass to the lessee and the time of passage is not
stated:

1. If a tender or delivery of goods so fails to conform to the lease contract as to
give a right of rejection, the risk of their loss remains with the lessor, or, in the
case of a finance lease, the supplier, until cure or acceptance.

2. If the lessee rightfully revokes acceptance, he, to the extent of any deficiency
in his effective insurance coverage, may treat the risk of loss as having remained with
the lessor from the beginning.

B. Whether or not risk of loss is to pass to the lessee, if the lessee as to
conforming goods already identified to a lease contract repudiates or is otherwise in
default under the lease contract, the lessor, or, in the case of a finance lease, the
supplier, to the extent of any deficiency in his effective insurance coverage may treat
the risk of loss as resting on the lessee for a commercially reasonable time.